Southern Gold's Challenger Nemesis discovery

• Large 1km long x 400m wide gold-in-calcrete anomaly identified at wholly-owned Nemesis Prospect directly north of producing Challenger gold mine

• Immediate infill sampling program scheduled to define drill-ready targets at Nemesis

• Exploration to commence on  large 5km x 5km regional calcrete anomaly at Brickies Prospect, SW of mine

• New RAB and RC drill programs planned early 2010 for advanced regional prospects to north and south of mine

Summary

Ongoing ground sampling by Southern Gold Limited (ASX: “SAU”) has identified a raft of new gold-in-calcrete anomalies within 15 kilometres of the producing Challenger gold mine in the far west of South Australia.

One of the anomalies is at least a kilometre in length and up to 400 metres wide and has been defined at the Nemesis Prospect, 12 kilometres north of the mine but within Southern Gold’s 100% owned tenement, EL 4161.

It was identified after Southern Gold returned to the site of a promising 2006 sampling program with a more detailed 400 metre by 400 metre sampling grid that yielded a peak result of 43 parts per billion (ppb) gold within a 10ppb anomaly. The newly identified anomaly is favourably orientated in northeast alignment only 12 kilometres directly north of the Challenger mine.

Southern Gold will immediately undertake an even more intensive infill sampling program, over 200 metre by 200 metre grids to determine a first pass RAB drilling schedule for this prospect.

Southern Gold is currently prioritising and assessing more than 50 gold anomalies within its 5,000km2 exploration footprint to the north and south of the million ounce Challenger mine, to bring these anomalous areas to drill ready status for 2010 drilling schedules.